By Kathryn Bender, Star-Bulletin
Members of the OWS Partners investment club meet in Manoa.
BULLISH:
By Russ Lynch
Isle investors team up
for fun and profit
Star-BulletinHonolulu Fire Capt. Mike Chung and some of his fellow firefighters used to chat at the station about their dabbles in mutual funds and stocks. "Why not form a club?," they thought. The result: Friends Investing for Resource Enhancement, which of course creates the acronym FIRE.
Laurie Yanagawa is college graduate but admits she didn't know anything about the stock market and had no idea what the numbers in the newspaper's business pages meant.
"I don't consider myself a poorly educated person, but I was out of college 10 or 15 years before I knew what I was looking at in the stock pages," Yanagawa said.
"Now, suddenly, it's so much fun."
Chun and Yanagawa are among the growing number of Hawaii residents who have joined investment clubs, usually small groups formed locally under the guidance of the National Association of Investors Corp.
They socialize and they invest. By pooling their money, usually kicking in $50 a month after an initial investment of a few hundred, they pay lower brokerage fees than they would if they all made individual transactions.
They also learn. The NAIC's Aloha Hawaii Chapter will take the education role a step further Saturday with an Investors Fair at the Sheraton Waikiki, open to the public for a $38 fee.
"A lot of the focus is to learn and earn at the same time," said Ryan Muraoka, a spokesman for the local NAIC organization who started an investment club - MIT, for Millionaires in Training - in 1994.
"You're educating yourself about investing, but you also have to treat it like a part-time business, because you're handling money," Muraoka said.
Such clubs have been around for decades. The one that appears to be the oldest in Honolulu, Wiki Kala Investment Club, was founded in 1961 by members of the American Association of University Women.
According to Ryan Muraoka of the Aloha Hawaii Council of the NAIC, there are 78 formal investors clubs in Hawaii with a total membership of 1,400.
"Some of the clubs have existed for many years and have been very successful in their investment endeavors," said Fumiko Wellington, who runs the local NAIC Web page on the Internet - http://www.better-investing.org/regions/hawaii.html.
"Other clubs are brand new. Our membership is growing at an astonishing pace," she said.
They are small groups. Nationally, the average size is 15 members. They operate on formal NAIC guidelines, following rules such as charting the stocks they own and voting formally on the investments.
But the groups vary greatly. Some are all men. Some are all women. Some are all workers in the same profession. Some are widely diversified.
"Most clubs are formed by people that know each other - family, friends, associates, some through attending seminars and so on," said Muraoka.
Each club is set up like a trust, a nonprofit organization under the umbrella of the NAIC, which provides software to facilitate trading, stock charting and educational endeavors by the clubs.
"We have NAIC tools - a stock selection guide, a portfolio management guide, interaction with the national (association) and local clubs and other clubs," Muraoka said.
Many members apply the knowledge they gain from the club to their personal investments outside the club, he said. "There's a proven systematic approach to investing and a long-term commitment. It forces you to focus on your investments at least once a month."
Muraoka said the NAIC stresses four keys to investing:
Invest regularly regardless of what the market is doing.
That last one means investing a companies of varying sizes as well as a variety of industries.
Laurie Yanagawa, whose OWS Partners club meets at her mother's house in Manoa, said there are 13 members in her group.
"It started out as a small group of office people working together - a core of six people who all worked in the same office - and slowly began to diversify," she said.
"We put in only $50 a month. We started in 1994 and even with the recent dip in the market we're up a little over 80 percent. We've been definitely keeping up with the market," Yanagawa said.
Technology stocks have been popular with her group but she said the club's portfolio, worth about $54,000 now, is "pretty diversified."
The money isn't huge.
"If we lost it all we'd go: 'Aw shucks, ow.' But it's technically play money. Nobody is dipping into their life savings," she said.
Being in a club and pooling resources "allows us to be a bit more aggressive without being reckless," she said.
Mike Chung said his group started mostly as just a firefighters' organization. Now there are women and people of diverse interests and knowledge, he said.
The club has a dozen members. Chung and the other founders wanted a certain commitment from the members so they decided each should put in $1,000 to start with and $50 a month.
"We're making about 18 percent. Prior to the last dip (in the stock market Oct. 27) we were up 22 percent," he said.
"We all get to educate ourselves further regarding financial information and we like getting together once a month.
"And we're hoping to make a little money on the side," Chung said.
Mike Corcoran, an Air Force retiree who runs a club that meets at the Hickam Air Force Base officers' club, said his group likely cashes out stocks more often than most because it is made up of military personnel, who move often. When someone leaves they can take out their share of the fund and the proceeds.
The club, started by officers' wives, is over 30 years old, Corcoran said. It has about 20 members. About a third are retired and the rest are active military, Corcoran said.
"We have 10 stocks," he said, in a portfolio worth about $50,000. "We have a meeting once a month. We're forced to be long-term investors. We make our decisions and live with them for a month."
All about money
